Title: BASF Offers to Acquire Ciba

BASF announced plans to acquire Ciba Holding AG, Basel, Switzerland, a leading specialty chemical company. The company has made a public takeover offer to Ciba’s shareholders, which Ciba's board of directors has recommended the shareholders accept.

According to BASF, it will pay CHF 50.00 (approx. US $44.6) in cash for each nominal share in Ciba. This offer corresponds to a premium of 32% above the closing price for Ciba’s shares on Sept. 12, 2008, and a premium of 60% above the volume-weighted average share price for Ciba shares in the 30 days prior to announcement of the public takeover offer. Based on all outstanding Ciba shares and including all net financial liabilities and pension obligations, the enterprise value would be CHF 6.1 billion (approximately €3.8 billion or US $5.4 billion).

“With the acquisition of Ciba, we are strengthening our portfolio and expanding our leading position in specialty chemicals with products and services for a variety of customer industries, in particular the plastics and coatings industries as well as water treatment," said Jürgen Hambrecht, PhD, chairman of the board of executive directors of BASF SE, in a press statement. He added that the company will will intensify the restructuring process in its paper business. "We recognize the strength of broad areas of Ciba’s portfolio...Ciba has a leading market position, in particular with its portfolio of plastics additives and coating effect materials, and offers its customers significant benefits.“

BASF noted that the integration of Ciba’s activities into BASF and further restructuring will give the businesses sustainable strength and offer them a long-term perspective for profitable growth. Hambrecht continued, “We look forward to working with Ciba’s highly committed executives and employees. We offer the company and its employees a new home with a long-term, viable perspective. Basel will remain an important site for parts of the combined business, in particular research, and we will establish a global operating division there."

Armin Meyer, PhD, chairman of the board of directors of Ciba, said in the press statement: “Ciba’s businesses will be strengthened substantially thanks to integration into BASF’s Verbund and the access to BASF’s research, production and marketing platform. This applies particularly in the plastics, coatings and paper divisions. BASF is a long-standing customer and supplier of Ciba and well-acquainted with our people and our business. The acquisition of Ciba by BASF will provide a long-term perspective for profitable growth of the Basel operations in particular and our other businesses around the world.”

According to BASF, the merger of BASF and Ciba would extend BASF’s position in the plastics industry and make BASF the second-largest supplier of coating effect materials. In the fast-growing and highly profitable market for plastics additives, BASF would expand its portfolio by gaining important product segments such as UV stabilizers and antioxidants. In the area of coating effect materials, the combination of BASF and Ciba would offer an extensive range of pigments, resins and additives.

The offer is subject to a number of conditions including the tendering of at least 66.67% of all nominal shares, approval by the relevant authorities, as well as the removal of various takeover defenses in Ciba’s statutes. BASF expects to finalize the transaction in the first quarter of 2009 at the latest. The financing for the offer is in place.